GAAP net income was $119.6 million, or $0.42 per diluted share, compared with $159.3 million, or $0.58 per diluted share, in last yearâs third quarter. Net income in this yearâs third quarter reflects a $100 million licensing fee for rights to PTC124, a promising genetic disease drug in late-stage development.
Non-GAAP net income rose 20 percent to $289.8 million from $241.3 million in the third quarter last year. Non-GAAP earnings grew 16 percent to $1.04 per diluted share compared with $0.90 per diluted share.
During the third quarter, Genzyme generated approximately $481 million in cash from net income prior to one-time events and proceeds from the issuance of common stock. The company has increased its cash position to approximately $1.5 billion while making investments to support long-term growth, including investments to expand manufacturing capacity, to offset dilution by repurchasing shares, and to complete strategic transactions that strengthen its late-stage pipeline.
"The third quarter was a very strong quarter financially and also extremely productive in terms of building for the future," said Henri A. Termeer, chairman and chief executive officer of Genzyme Corp. "Our broad geographic diversification, solid cash position, and group of market-leading products will allow us to sustain our growth through the current financial environment and over the longer term."
Genzyme is on track to meet its goal of 20 percent compound average non-GAAP earnings growth from 2006 through 2011. For 2009, the company expects non-GAAP earnings to increase to approximately $4.70 per diluted share. Non-GAAP earnings are projected to rise to approximately $7.00 per diluted share by 2011.
These estimates include the impact of Genzyme's redemption of its convertible senior notes. The company plans to redeem all $690 million of these notes as of December 1, 2008. The notes are redeemable in cash or can be converted to common stock at the option of the noteholders at a conversion price of $71.24 per share.
One of the world's leading biotechnology companies, Genzyme is dedicated to making a major positive impact on the lives of people with serious diseases. Since 1981, the company has grown from a small start-up to a diversified enterprise with more than 10,000 employees in locations spanning the globe and 2007 revenues of $3.8 billion. In 2007, Genzyme was chosen to receive the National Medal of Technology, the highest honor awarded by the President of the United States for technological innovation.
With many established products and services helping patients in nearly 90 countries, Genzyme is a leader in the effort to develop and apply the most advanced technologies in the life sciences. The company's products and services are focused on rare inherited disorders, kidney disease, orthopaedics, cancer, transplant, and diagnostic testing. Genzyme's commitment to innovation continues today with a substantial development program focused on these fields, as well as immune disease, cardiovascular disease, and other areas of unmet medical need.
Genzyme's press releases and other company information are available at www.genzyme.com.